Japan, along with the United States, stayed out of the China-led initiative to create the Asian Infrastructure Investment Bank (AIIB) as delegates from 57 countries that signed up as founding members attended a ceremony in Beijing on Monday to ink an accord specifying the initial capital and other details of the new regional lender. The government has cited questions over transparency in its governance and lending rules as key reasons to opt out of the new bank, but Japan should still consider future participation if it wants to influence the AIIB's operations so that it will be run in accordance with international norms.
During the ceremony, Chinese Finance Minister Lou Jiwei hailed the AIIB, to be launched by the end of the year with initial capitalization of $100 billion, as an "important initiative proposed by China to uphold more international responsibilities for the economic development of Asia and the world at large." The initiative — first proposed by President Xi Jinping in October 2013 — has been viewed as an attempt by China, which became the world's second-largest economy in 2010, to challenge the postwar U.S.-led international financial order.
Beijing has long been frustrated with the failure of existing institutions such as the International Monetary Fund and the World Bank to give more say to emerging powers led by China in line with their growing economic clout. Washington has been wary of the AIIB because it represents China's bid for greater influence in the global economic architecture long dominated by the advanced industrialized economies, and Tokyo went along by staying out even as Britain, Germany, France and Italy signed up to become founding members.
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